Aldi Australia’s $15 billion sales prediction, Morgan Stanley

Aldi Australia has the potential to be bringing in AUD $15 billion in annual sales by 2020 says a new Morgan Stanley report.

Released yesterday, the report analysed that shoppers are now spending an average of AUD$100 per month at Aldi, a massive increase on the AUD$60 being spent at Aldi in 2007.

As Aldi is a privately owned company it is not required to publicly report its profits, however Morgan Stanley estimated its Australian sales equalled AUD $6.4 billion in the 12 months ending 30 June 2015. If it reaches AUD$15 billion sales in 2020 this will represent an AUD$8.6 billion growth in sales in less than five years.

Comparatively, Morgan Stanley predicts Woolworths supermarkets on current trends could make sales of approximately AUD $46 billion in sales in 2020. For the 12 months ending the 30 June 2015, Woolworths Food and Liquor made AUD $42.1 billion in sales.

Meanwhile, the report says that Coles sales will grow from the AUD $30.8 billion worth of sales reported for the 12 months ending 30 June 2015 to AUD $37.2 billion by 2020.

IGA is estimated to have AUD$13 billion in sales in 2020. In the 12 months ending the 30 June 2015 it reported sales figures of AUD$13.2 billion.

Morgan Stanley says its prediction for Aldi’s sales to hit AUD $15 billion is based on Aldi’s ability to establish the same amount of stores in South Australia and Western Australia as it currently has in other Australian states.

How consumers end up spending more at Aldi

According to the report, customers tend to start out buying staples like sugar and rice at Aldi, assuming these products have “very low risk failure”.

“After these products have met consumer’s expectations, they buy more products, moving into dry grocery lines,” the report stated.

“Again, after these expectations have been met, the last category customers graduate to its fresh food.”